If you employ staff in Ireland, pension auto-enrolment becomes part of your business and employment environment from 1^st January 2026!

You may be aware that the scheme was originally scheduled to commence from September 2025, but that start date was moved to allow for additional preparation time.

The direction of travel, however, has not changed in the interim, where auto-enrolment represents a significant change to how payroll, pensions and employee costs have operated to date. 

It introduces new obligations for employers, new payroll administration and a new central authority for Employers to have to liaise with in addition to Revenue.

Ultimately though, the auto enrolment scheme is a national response to a long standing problem around the adequacy of employee retirement savings - therefore most SME business owners broadly understand that.

Why Auto-Enrolment Exists?

The Government (or State) pension alone is not designed to support a comfortable retirement.

At the same time, people are living longer, which has increased (and will continue to increase) pressure on public finances, so the auto-enrolment pension scheme is aimed at addressing both issues by including retirement saving into employment.

The scheme has been designed with a set up using a shared contribution model between 

• Employees
• employers, and
• the State

An interesting element which has been included within the scheme, is that relevant employees are  included in the auto enrolment scheme by default!

History has shown us that most people are highly subject to ‘inertia’ i.e. it is far more likely that employees will NOT take the steps to ‘opt out’ of the system once they have been included in the first place . . .

How it Works in Practice!

From 1^st January 2026, a the NEW national workplace pension savings system will be known as My Future Fund.

It will be administered by the National Automatic Enrolment Retirement Savings Authority or NAERSA.

The main responsibilities of NAERSA will include the following:

• Identify eligible employees using Revenue payroll data
• Enrol relevant employees into the auto enrolment scheme 
• Collect all pension contributions
• Invest the funds appropriately 
• Operate the MyFutureFund Employer and Employee portals

It should be noted though, that the main thrust of the auto enrolment pension scheme/MyFutureFund, is to try and minimise the amount of the administrative burden for Employers as much as possible.

Employees will be ‘auto-enrolled’ if they:

• Are aged between 23 and 60
• Earn over €20,000 per year (across all employments)
• Are not already in a workplace pension

All existing employees across Ireland will be are assessed for inclusion in the scheme on 1^st January 2026, with any new joiners assessed as they enter employment.

Eligibility may be confirmed immediately by NAERSA or through a lookback period e.g. up to 13 weeks until the notification is confirmed in some circumstances.

The pension contributions into the MyFutureFund are being phased in over ten years.

They begin at:

• 1.5% Employee
• 1.5% Employer
• 0.5% State

But will ultimately rise to a maximum of 14% in total :

• 6% Employee
• 6% Employer
• 2% State

Pension contributions apply to earnings for individuals up to a ceiling of €80,000 per annum – after which NO further contributions are required.

Please note that under this scheme (unlike other pension contributions), employees DO NOT receive tax relief on their own contributions – instead the State provides a top-up equivalent to €1 for every €3 contributed.

Finally there is an ‘opt out’ option available for employees who can do so after a fixed period of six months, with their contributions being refunded, however Employer and State contributions remain invested and are NOT refunded !

Key Employer Responsibilities

Under the scheme there are a few responsibilities that Employers MUST comply with:

• REGISTER -  on the MyFutureFund portal
• SETUP - a payment method to pay across pension contributions 
• PROCESS – AEPN notifications for their employees through payroll
• PAY – across both employee and employer contributions to NAERSA
• MAINTAIN – appropriate records

Obviously failure to comply with these key responsibilities will result in penalties.

Final Thoughts

Although auto enrolment is an additional administrative requirement for Employers, along with a (small) additional business cost initially, at SAKURA we are here to support our clients as much as possible across the transition period !

• We will carry out the initial registration with the MyFutureFund portal for you (as the Employer)
• We can act as the main contact for NAERSA in respect of the auto enrolment scheme (as we will already be managing your payroll), and 
• we will keep you up to date with the new changes and clarifications from both Revenue and NAERSA as we get closer to the 1^st January 2026 start date.

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